SlideShare uma empresa Scribd logo
1 de 1
The Estrada Company uses cost-plus pricing with a 0.37 mark-up. The company is currently
selling 100,000 units at $12 per unit. Each unit has a variable cost of $5.60. In addition, the
company incurs $186,800 in fixed costs annually. If demand falls to 72,200 units and the
company wants to continue to earn a 0.37 return, what price should the company charge?
(SHOW WORK)
Solution
Statement showing computation of Price Particulars Desired Price No of units sold
                         72,200.00 Variable Costs Per unit
                                    5.60
Total Variable costs(No of units*VC per unit)
                       404,320.00 Fixed Costs
                       186,800.00 Total Costs(VC + FC)
                       591,120.00 No of units sold
                         72,200.00 Unit Cost
                                    8.19
Mark Up @37%
                                    3.03
Price company should charge(8.19+3.03)
                                  11.22

Mais conteúdo relacionado

Mais de carold11

The executive officers of Rouse Corporation have a performance-based c.docx
The executive officers of Rouse Corporation have a performance-based c.docxThe executive officers of Rouse Corporation have a performance-based c.docx
The executive officers of Rouse Corporation have a performance-based c.docx
carold11
 
The enqueue operation on the Queue ADT adds a new item to the back of (1).docx
The enqueue operation on the Queue ADT adds a new item to the back of (1).docxThe enqueue operation on the Queue ADT adds a new item to the back of (1).docx
The enqueue operation on the Queue ADT adds a new item to the back of (1).docx
carold11
 
The Fed follows the theory of bureaucratic behavior in what sense-.docx
The Fed follows the theory of bureaucratic behavior in what sense-.docxThe Fed follows the theory of bureaucratic behavior in what sense-.docx
The Fed follows the theory of bureaucratic behavior in what sense-.docx
carold11
 
Pat ts oints Give all answers to the corret number of significant figu.docx
Pat ts oints Give all answers to the corret number of significant figu.docxPat ts oints Give all answers to the corret number of significant figu.docx
Pat ts oints Give all answers to the corret number of significant figu.docx
carold11
 
Partial balance sheets and additional iformation are listed below for.docx
Partial balance sheets and additional iformation are listed below for.docxPartial balance sheets and additional iformation are listed below for.docx
Partial balance sheets and additional iformation are listed below for.docx
carold11
 
Part B 1- (2 pts-) Write the reaction equation of ammonium ions with s.docx
Part B 1- (2 pts-) Write the reaction equation of ammonium ions with s.docxPart B 1- (2 pts-) Write the reaction equation of ammonium ions with s.docx
Part B 1- (2 pts-) Write the reaction equation of ammonium ions with s.docx
carold11
 
Part 3 Your animation should contain at least the following- Translati.docx
Part 3 Your animation should contain at least the following- Translati.docxPart 3 Your animation should contain at least the following- Translati.docx
Part 3 Your animation should contain at least the following- Translati.docx
carold11
 

Mais de carold11 (20)

The following accounts were taken from ABC CompanySolutionCalculation (1).docx
The following accounts were taken from ABC CompanySolutionCalculation (1).docxThe following accounts were taken from ABC CompanySolutionCalculation (1).docx
The following accounts were taken from ABC CompanySolutionCalculation (1).docx
 
The fiscal 2012 financial statements of Barney Services shows average.docx
The fiscal 2012 financial statements of Barney Services shows average.docxThe fiscal 2012 financial statements of Barney Services shows average.docx
The fiscal 2012 financial statements of Barney Services shows average.docx
 
The equity sections from Atticus Group The equity sections from.docx
The equity sections from Atticus Group        The equity sections from.docxThe equity sections from Atticus Group        The equity sections from.docx
The equity sections from Atticus Group The equity sections from.docx
 
The executive officers of Rouse Corporation have a performance-based c.docx
The executive officers of Rouse Corporation have a performance-based c.docxThe executive officers of Rouse Corporation have a performance-based c.docx
The executive officers of Rouse Corporation have a performance-based c.docx
 
The Federal Reserve had to resort to non-standard methods to try to st.docx
The Federal Reserve had to resort to non-standard methods to try to st.docxThe Federal Reserve had to resort to non-standard methods to try to st.docx
The Federal Reserve had to resort to non-standard methods to try to st.docx
 
The EU recently admitted the Eastern European countries- How do you as.docx
The EU recently admitted the Eastern European countries- How do you as.docxThe EU recently admitted the Eastern European countries- How do you as.docx
The EU recently admitted the Eastern European countries- How do you as.docx
 
The Esposito Import Company had 1 million shares of common stock outst.docx
The Esposito Import Company had 1 million shares of common stock outst.docxThe Esposito Import Company had 1 million shares of common stock outst.docx
The Esposito Import Company had 1 million shares of common stock outst.docx
 
The energy levels of electrons are related to their- a) Position on t.docx
The energy levels of electrons are related to their-  a) Position on t.docxThe energy levels of electrons are related to their-  a) Position on t.docx
The energy levels of electrons are related to their- a) Position on t.docx
 
The Electron in a Hydrogen Atom transforms from its n-1 state to its n.docx
The Electron in a Hydrogen Atom transforms from its n-1 state to its n.docxThe Electron in a Hydrogen Atom transforms from its n-1 state to its n.docx
The Electron in a Hydrogen Atom transforms from its n-1 state to its n.docx
 
The enqueue operation on the Queue ADT adds a new item to the back of (1).docx
The enqueue operation on the Queue ADT adds a new item to the back of (1).docxThe enqueue operation on the Queue ADT adds a new item to the back of (1).docx
The enqueue operation on the Queue ADT adds a new item to the back of (1).docx
 
The Fed follows the theory of bureaucratic behavior in what sense-.docx
The Fed follows the theory of bureaucratic behavior in what sense-.docxThe Fed follows the theory of bureaucratic behavior in what sense-.docx
The Fed follows the theory of bureaucratic behavior in what sense-.docx
 
Pay structures Union contracts Wage and price contracts Levels of reve.docx
Pay structures Union contracts Wage and price contracts Levels of reve.docxPay structures Union contracts Wage and price contracts Levels of reve.docx
Pay structures Union contracts Wage and price contracts Levels of reve.docx
 
Pat ts oints Give all answers to the corret number of significant figu.docx
Pat ts oints Give all answers to the corret number of significant figu.docxPat ts oints Give all answers to the corret number of significant figu.docx
Pat ts oints Give all answers to the corret number of significant figu.docx
 
Partial balance sheets and additional iformation are listed below for.docx
Partial balance sheets and additional iformation are listed below for.docxPartial balance sheets and additional iformation are listed below for.docx
Partial balance sheets and additional iformation are listed below for.docx
 
PART ONE- Briefly explain and illustrate how the unemployment rate and.docx
PART ONE- Briefly explain and illustrate how the unemployment rate and.docxPART ONE- Briefly explain and illustrate how the unemployment rate and.docx
PART ONE- Briefly explain and illustrate how the unemployment rate and.docx
 
Part K (There is no common name for this species-) CHO Spell out the f.docx
Part K (There is no common name for this species-) CHO Spell out the f.docxPart K (There is no common name for this species-) CHO Spell out the f.docx
Part K (There is no common name for this species-) CHO Spell out the f.docx
 
Part I- Avoid claims rejections A payer may delay or deny payment beca.docx
Part I- Avoid claims rejections A payer may delay or deny payment beca.docxPart I- Avoid claims rejections A payer may delay or deny payment beca.docx
Part I- Avoid claims rejections A payer may delay or deny payment beca.docx
 
Part B 1- (2 pts-) Write the reaction equation of ammonium ions with s.docx
Part B 1- (2 pts-) Write the reaction equation of ammonium ions with s.docxPart B 1- (2 pts-) Write the reaction equation of ammonium ions with s.docx
Part B 1- (2 pts-) Write the reaction equation of ammonium ions with s.docx
 
Part A Prepare an income statement and a statement of retained earning.docx
Part A Prepare an income statement and a statement of retained earning.docxPart A Prepare an income statement and a statement of retained earning.docx
Part A Prepare an income statement and a statement of retained earning.docx
 
Part 3 Your animation should contain at least the following- Translati.docx
Part 3 Your animation should contain at least the following- Translati.docxPart 3 Your animation should contain at least the following- Translati.docx
Part 3 Your animation should contain at least the following- Translati.docx
 

Último

Activity 01 - Artificial Culture (1).pdf
Activity 01 - Artificial Culture (1).pdfActivity 01 - Artificial Culture (1).pdf
Activity 01 - Artificial Culture (1).pdf
ciinovamais
 
1029-Danh muc Sach Giao Khoa khoi 6.pdf
1029-Danh muc Sach Giao Khoa khoi  6.pdf1029-Danh muc Sach Giao Khoa khoi  6.pdf
1029-Danh muc Sach Giao Khoa khoi 6.pdf
QucHHunhnh
 

Último (20)

Spatium Project Simulation student brief
Spatium Project Simulation student briefSpatium Project Simulation student brief
Spatium Project Simulation student brief
 
Food safety_Challenges food safety laboratories_.pdf
Food safety_Challenges food safety laboratories_.pdfFood safety_Challenges food safety laboratories_.pdf
Food safety_Challenges food safety laboratories_.pdf
 
ComPTIA Overview | Comptia Security+ Book SY0-701
ComPTIA Overview | Comptia Security+ Book SY0-701ComPTIA Overview | Comptia Security+ Book SY0-701
ComPTIA Overview | Comptia Security+ Book SY0-701
 
Google Gemini An AI Revolution in Education.pptx
Google Gemini An AI Revolution in Education.pptxGoogle Gemini An AI Revolution in Education.pptx
Google Gemini An AI Revolution in Education.pptx
 
Making communications land - Are they received and understood as intended? we...
Making communications land - Are they received and understood as intended? we...Making communications land - Are they received and understood as intended? we...
Making communications land - Are they received and understood as intended? we...
 
Unit-IV- Pharma. Marketing Channels.pptx
Unit-IV- Pharma. Marketing Channels.pptxUnit-IV- Pharma. Marketing Channels.pptx
Unit-IV- Pharma. Marketing Channels.pptx
 
UGC NET Paper 1 Mathematical Reasoning & Aptitude.pdf
UGC NET Paper 1 Mathematical Reasoning & Aptitude.pdfUGC NET Paper 1 Mathematical Reasoning & Aptitude.pdf
UGC NET Paper 1 Mathematical Reasoning & Aptitude.pdf
 
Activity 01 - Artificial Culture (1).pdf
Activity 01 - Artificial Culture (1).pdfActivity 01 - Artificial Culture (1).pdf
Activity 01 - Artificial Culture (1).pdf
 
How to Manage Global Discount in Odoo 17 POS
How to Manage Global Discount in Odoo 17 POSHow to Manage Global Discount in Odoo 17 POS
How to Manage Global Discount in Odoo 17 POS
 
Graduate Outcomes Presentation Slides - English
Graduate Outcomes Presentation Slides - EnglishGraduate Outcomes Presentation Slides - English
Graduate Outcomes Presentation Slides - English
 
Understanding Accommodations and Modifications
Understanding  Accommodations and ModificationsUnderstanding  Accommodations and Modifications
Understanding Accommodations and Modifications
 
This PowerPoint helps students to consider the concept of infinity.
This PowerPoint helps students to consider the concept of infinity.This PowerPoint helps students to consider the concept of infinity.
This PowerPoint helps students to consider the concept of infinity.
 
Single or Multiple melodic lines structure
Single or Multiple melodic lines structureSingle or Multiple melodic lines structure
Single or Multiple melodic lines structure
 
ICT Role in 21st Century Education & its Challenges.pptx
ICT Role in 21st Century Education & its Challenges.pptxICT Role in 21st Century Education & its Challenges.pptx
ICT Role in 21st Century Education & its Challenges.pptx
 
SKILL OF INTRODUCING THE LESSON MICRO SKILLS.pptx
SKILL OF INTRODUCING THE LESSON MICRO SKILLS.pptxSKILL OF INTRODUCING THE LESSON MICRO SKILLS.pptx
SKILL OF INTRODUCING THE LESSON MICRO SKILLS.pptx
 
TỔNG ÔN TẬP THI VÀO LỚP 10 MÔN TIẾNG ANH NĂM HỌC 2023 - 2024 CÓ ĐÁP ÁN (NGỮ Â...
TỔNG ÔN TẬP THI VÀO LỚP 10 MÔN TIẾNG ANH NĂM HỌC 2023 - 2024 CÓ ĐÁP ÁN (NGỮ Â...TỔNG ÔN TẬP THI VÀO LỚP 10 MÔN TIẾNG ANH NĂM HỌC 2023 - 2024 CÓ ĐÁP ÁN (NGỮ Â...
TỔNG ÔN TẬP THI VÀO LỚP 10 MÔN TIẾNG ANH NĂM HỌC 2023 - 2024 CÓ ĐÁP ÁN (NGỮ Â...
 
1029-Danh muc Sach Giao Khoa khoi 6.pdf
1029-Danh muc Sach Giao Khoa khoi  6.pdf1029-Danh muc Sach Giao Khoa khoi  6.pdf
1029-Danh muc Sach Giao Khoa khoi 6.pdf
 
Kodo Millet PPT made by Ghanshyam bairwa college of Agriculture kumher bhara...
Kodo Millet  PPT made by Ghanshyam bairwa college of Agriculture kumher bhara...Kodo Millet  PPT made by Ghanshyam bairwa college of Agriculture kumher bhara...
Kodo Millet PPT made by Ghanshyam bairwa college of Agriculture kumher bhara...
 
Mehran University Newsletter Vol-X, Issue-I, 2024
Mehran University Newsletter Vol-X, Issue-I, 2024Mehran University Newsletter Vol-X, Issue-I, 2024
Mehran University Newsletter Vol-X, Issue-I, 2024
 
Application orientated numerical on hev.ppt
Application orientated numerical on hev.pptApplication orientated numerical on hev.ppt
Application orientated numerical on hev.ppt
 

The Estrada Company uses cost-plus pricing with a 0-37 mark-up- The co.docx

  • 1. The Estrada Company uses cost-plus pricing with a 0.37 mark-up. The company is currently selling 100,000 units at $12 per unit. Each unit has a variable cost of $5.60. In addition, the company incurs $186,800 in fixed costs annually. If demand falls to 72,200 units and the company wants to continue to earn a 0.37 return, what price should the company charge? (SHOW WORK) Solution Statement showing computation of Price Particulars Desired Price No of units sold                          72,200.00 Variable Costs Per unit                                     5.60 Total Variable costs(No of units*VC per unit)                        404,320.00 Fixed Costs                        186,800.00 Total Costs(VC + FC)                        591,120.00 No of units sold                          72,200.00 Unit Cost                                     8.19 Mark Up @37%                                     3.03 Price company should charge(8.19+3.03)                                   11.22